A futurist looks at CUs and here's what he sees

November 5, 2014

LAS VEGAS (11/6/14)--Richard Worzel is a strategic planner and a futurist, and on Wednesday he turned his thoughts and observations toward the future of credit unions.

Richard Worzel, a strategic planner and a futurist, encourages his audience at CUNA's Community Credit Union & Growth Conference Wednesday to capitalize on changes that are coming in technology and demographics. (CUNA Photo)

Worzel, in a keynote session at the Credit Union National Association's Community Credit Union & Growth Conference, took a look at the forces that are changing the credit union operational landscape and encouraged credit unions to capitalize on the changes.

Among them are rapidly evolving technology--promising to continue surprising the financial marketplace at an astonishing rate: 3D printing and its implications for society; the economy; and, very importantly for credit unions, demographics.

Worzel emphasized that a futurist is a planner, not a prophet. "You will be surprised by the future. One thing I want to impress on you is that tomorrow is going to be very different than today," he promised.

He forecast 3-D printing as the next biggest disruptive technology, saying it will be as disruptive and induce as much change for industries such as housing and the medical field as the advent of the Internet did for newspapers, retailing and financial institutions.

For credit unions and the financial industry, Worzel identified big data and changing demographics to be two of the biggest factors that will impact credit unions' futures--and should impact their current planning.

Proper mining and analytics of big data--that seemingly infinite body of information spawned by the growth of technology and the Internet specifically, and which grows always and exponentially--will be part of the future of success finance, he said.

For instance, he painted a picture of a future when big data analytics could allow a credit union to give each member the kind of personal treatment that would be possible if a credit union had only 10 members--a credit union could treat each member "like gold."

Another future possibility--being explored by progressive companies even now--is using big data as a different kind of credit-risk evaluation. The thought is that the magazines a person reads, where they go on vacation, what interest the person has may be a better indicator of a person's creditworthiness than tests currently used.

Demographics is another area that credit unions should closely study now to chart the future of what they offer and how they offer it. For instance, Worzel suggested that echo-boomers, those ranging loosely from 17 to 35 years old, may not be making money right now--finding challenges in securing meaningful work beyond what their parents' generation faced--but they will. And they may be delaying major life stages, i.e. family formation and house buying, beyond their parents' range of early to mid-20s--but will move into those high consumption life choices in their early to mid-30s. Credit unions should be cultivating these consumers now.

Woman are growing as financial leaders in their households and will likely dominate in that role in the next generation, Worzel said, adding that to date they have been an underserved market in financial services.

Credit unions should also prepare to support their, Worzel said, who are the financial caretakers of the "oldest elderly" demographic. And they should build programs to support the biggest generation--the baby boomers--as they move into uncharted waters of retirement.

Worzel said the most important thing for credit unions to do now is to determine what are the features of their "most-desired futures." The next step is to take a longer view into the future and to look beyond America's borders to identify influences that will affect credit union business needs and members' financial services needs.

The bottom line, Worzel says, is that:

Technology is changing all the rules--profit or perish;

Demographics are changing--who we are and what we need is changing--look for opportunities; and

Don't just let the future happen to you--make it work for you.

Quoting Arie de Geus, futurist for Royal Dutch Shell, Worzel summed things up: "Learning faster than your competitors is the only sustainable competitive advantage in an environment of rapid change and innovations."

The CUNA Community Credit Union & Growth Conference, which ends today, offers a full slate of keynote speakers, breakout sessions, workshops and solution sessions. This annual conference aims to bolster connections within the credit union movement and help guide credit unions to maximize their growth potential The 2015 conference will be held Sept. 22-25 in Phoenix, in conjunction with the National Federation of Community Credit Unions' annual conference.

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